Mortgage advice please

dazcouz Posts: 2,530 Forumite
edited 30 October 2015 at 12:56AM in Mortgages & endowments

Back in June 2011 I decided to purchase a two-bedroom flat for £134,000 on my own. I used all my savings of £40,000 and took out a £94,000 repayment mortgage over 35 years.

As of October 2015 my flat is now worth £168,000 (according to Zoopla) and my mortgage is down to £88,000 plus I have around £51,000 in savings.

What should I do next? I have set a goal of paying off the mortgage as fast as possible but is this wise? This is the only property I have ever bought (I am 28). Should I think of eventually moving up to a house (I am single)?

Thanks, just looking for some advice
Competion Wins 2008 - £1700 - 2009 £5300
2010- £680


  • Hi Dazcouz

    I would highy recommend popping over to the Mortgage free wannabe forum. Lots of nice people there with brilliant advice.

    You can get some ideas on paying off your mortgage or alternatively becoming mortgage neutral (i.e. having savings/investments equal or greater than your mortgage value)

    For those with the motivation and inclination to pay off their mortgage, it makes sense to build up an emergency fund (which you have) and then overpaying your mortgage (within the limits of your ERC %s & contract).

    The big question is what are your medium term and long term goals? Mortgage free? bigger house? investment portfolio? retire at 40?
    While you are trying to decide what these goals are there is nothing stopping you from overpaying your mortage in the short term resulting in paying the banks less interest.
    Have a play with the mortgage OP calculator to see the impact.
    Oh and have a look at Mr Money Moustache. Some good ideas there too (although a bit extreme and very american!)

    good luck, MIB
    MFW2020 #5 £2,000/2,000 MFW2021 #5 £1,850/3,500MFW2022 #5 £3.001/3,000Sep'12 £233,750 Jan'15 £222,329 Dec’21 £139,584 MFiT T4 #24 £48k/£34k MFiT T5 #24 £22,186/£41k MFiT T6 #24 £4,700/£29k
  • Kynthia
    Kynthia Posts: 5,659
    First Post First Anniversary Combo Breaker
    If you are paying more in mortgage interest than you are earning in savings interest then paying down your mortgage is a good idea. However you should always keep some savings accessible for emergencies and short term living costs shoukd you be between jobs at some point.

    Buying and selling property incurs a lot of fees and expenses. You should do it as few times as possible so I'd only buy a bigger place if I knew what I wanted.

    What are your life plans that you might want the money for? Studying, a car, a wedding, a buy to let property, a year travelling, etc.
    Don't listen to me, I'm no expert!
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